Investment DA N A LARGE CAP E Q U I T Y STRATEGY.

Transcription

1 Investment DANA Advisors DA N A LARGE CAP E Q U I T Y STRATEGY

2 THE WISE CHOICE HERITAGE A strong family culture Since our founding in 1980, Dana has remained independent and Employee-owned. Our investment firm is built on trust, integrity, and professional experience. QUALITY Excellence in meeting client expectations Dana strives to provide personalized client service and excellence in everything it does. We are uncompromising in our efforts to deliver superior results to clients. EXPERTISE Focus on what we do best Dana has assembled an investment team with diverse skill sets and specialized knowledge. We are adept at navigating challenging market environments and developing customized solutions. CONSISTENCY Adherence to a uniform process Dana implements a uniform investment process to minimize volatility and improve consistency of returns. We seek repeatable and predictable results to most effectively grow cumulative wealth. Investment DANA Advisors 2

3 DANA INVESTMENT ADVISORS Dana Investment Advisors was built on the belief that adhering to a defined investment process allows our professionals to focus on the fundamentals of consistent outperformance through security selection. Founded in 1980 Employee-owned Domestic equity, taxable and tax-exempt fixed income, and ESG asset manager Manage $7.4 billion as of March 31, 2018 Headquartered in Brookfield, Wisconsin We ve never wavered from our goal of providing above market returns while reducing volatility for our clients. 3

4 DANA INVESTMENT ADVISORS AWARDS AND RECOGNITION Pensions & Investments Best Places to Work Award Dana Investment Advisors has been recognized as the top place to work 2017 Best Places to Work in Money Management by Pensions & Investments. This is the sixth year in a row Dana Investment Advisors has been awarded this industry distinction. We are honored that Pensions & Investments has again recognized us for our strong culture, dedication to our employees, and social impact stated Mark Mirsberger, Firm CEO, adding, Our strong family/employee culture directly impacts our client experience as clients benefit from working with and developing strong relationships with a passionate team that essentially has little to no turnover for decades. Impact Manager of the Year Award Dana s Social ESG Equity Strategy Dana Investment Advisors has been named the SMA Impact Manager of the Year by Envestnet PMC. This was the 11 th annual SMA Awards by Envestnet and the first time an award was given in the Impact space. Dana s Director of Equities and Portfolio Manager, Duane Roberts, notes that contrary to many investors conception, integrating environmental, social and governance (ESG) criteria into the portfolio management process may enhance financial returns. We have delivered consistent, superior investment performance over the Social ESG Equity Strategy s 15 year history. SMA U.S. Large Cap Equity Manager of the Year Dana Investment Advisors has been named the SMA U.S. Large Cap Equity Manager of the Year by Envestnet PMC. This was the 10th annual SMA Awards by Envestnet PMC, formerly Prima Capital, and recognizes managers that consistently outperform their peers over time, following a clearly defined sustainable and repeatable alpha strategy. Firm CEO Mark Mirsberger - This recognition is the result of hard work and dedication of our talented investment team and highlights that staying true to a superior investment process with disciplined risk controls can lead to consistent out-performance. 4

5 DANA EQUITY STRATEGIES INVESTMENT PHILOSOPHY AND PROCESS Investment Philosophy We strive to generate excess risk-adjusted returns through a consistent and disciplined investment process. 5

6 DANA EQUITY STRATEGIES INVESTMENT PHILOSOPHY AND PROCESS Relative Valuation Sector Neutral Equal Weighting Position Size Limits Fully Invested % 51.7% 2.0% -6.9% 46.6% 28.8% 29.1% 36.5% 32.4% -17.7% 59.9% 27.6% 19.9% 28.8% 43.1% 29.0% 10.1% 27.3% 38.8% 24.1% 23.0% 20.0% 17.4% 16.0% 2.3% -11.6% -12.8% -16.6% 35.6% 23.4% 14.5% 13.2% 4.5% -17.7% -20.7% -40.0% -41.0% 1.0% -13.0% Dana s sector neutral investment approach recognizes it is very difficult to predict future sector performance. Dana s Risk Approach: are the groundwork for our repeatable and consistent investment process. -7.0% -8.3% -10.5% -12.3% -13.7% -26.0% -32.5% -7.7% -13.3% -16.4% -20.0% -24.5% -27.6% -33.0% -35.9% -37.6% 36.1% 34.8% 29.8% 27.9% 22.4% 21.1% 13.3% 9.2% 3.3% 19.6% 16.0% 16.0% 12.1% 10.8% 8.2% 6.0% 2.1% 0.2% 12.8% 4.9% 3.7% 2.2% 1.3% 0.4% 0.4% -7.4% -9.1% S&P 500 Sector Performance 23.7% 21.5% 19.8% 19.5% 18.9% 14.3% 13.8% 7.9% 7.8% 20.0% 15.8% 15.5% 11.6% 9.8% 8.5% 5.4% -14.3% -20.8% -24.5% -31.6% -33.6% -34.7% -35.9% -41.5% -43.7% -47.1% -57.0% 45.2% 38.8% 17.3% 17.1% 14.8% 11.3% 11.2% 6.8% 2.6% 26.9% 22.9% 19.7% 19.5% 14.2% 12.2% 10.5% 5.5% 2.8% 13.9% 12.7% 6.3% 6.1% 4.7% 2.4% -0.6% -9.7% -17.1% 23.9% 18.3% 17.7% 15.3% 15.0% 14.7% 10.8% 4.4% 1.7% 41.5% 40.7% 35.6% 28.4% 26.1% 25.6% 25.1% 13.2% 11.5% 25.3% 20.1% 16.0% 15.2% 9.8% 9.7% 6.9% 3.0% -7.8% 7.0% 6.6% 5.9% 3.4% -1.5% -2.7% -4.9% -8.4% -21.1% 23.5% 21.7% s 18.4% 16.4% 15.9% 13.9% 6.1% 5.4% Real Estate 3.7% -2.5% 23.8% 23.0% 22.2% 22.0% s 21.3% 13.5% 11.8% Real Estate 10.8% -1.1% -1.3% 2018? 6 Source: Dana Investment Advisors; Bloomberg and FactSet Data Systems

7 DANA EQUITY STRATEGIES INVESTMENT PHILOSOPHY AND PROCESS Valuations (Quantitative Analysis) Growth Estimate Revisions The idea generation phase RELATIVE VALUATION MODEL VALUE RELATIVE TO GROWTH MODEL ESTIMATE REVISIONS MODEL leverages our propriety models to generate segmented data that efficiently focuses our research on improving or deteriorating trends within sectors, industries DANA RANK or individul companies. We feel this dynamic component is a key advantage and provides a platform that focuses our stock selection. 7

8 DANA EQUITY STRATEGIES INVESTMENT PHILOSOPHY AND PROCESS Business Model & Management Profitability Cash Flow Earnings Decomposition Fundamental analysis is the basis for all of Dana s investment decisions Business Model Profitability Cash Flow Earnings Decomposition Quality of Management Quality of Environmental, Social, and Governance Factors Competitive advantages ROE / ROA Margins Impact of leverage Earnings history Operating Free Capital requirements Uses of cash Estimates and execution Surprise history components and revision trends Earnings quality 8

9 DANA EQUITY STRATEGIES INVESTMENT PHILOSOPHY AND PROCESS Fundamental Characteristics Relative Strength Model Ranking Rebalance Fundamental analysis drives the Dana sell discipline Fundamental Characteristics Relative Strength Model Ranking Rebalance Company execution More attractive risk reward opportunity Sector Performance Industry Performance Relative valuation model Value-to-growth model Position weight Sector weight Industry dynamics Estimate revisions model 9

10 DANA ESG PROCESS ADVOCACY HIGHLIGHTS Q Offshore Drilling Signed on to an investor letter to Ryan Zinke, Secretary of the Department of the Interior, arguing against the Administration s proposed expansion of offshore drilling in coastal waters of the United States. (March 2018, coordinated by US SIF) Arctic Refuge Signed on to an investor letter urging oil and gas companies, and the banks that fund them, not to initiate any oil and gas development in the Arctic Refuge. Drilling has been blocked in the Arctic National Wildlife Refuge for decades, but this was overturned by the recent tax bill, which calls for the federal government to hold at least two oil and gas lease sales in the next decade. (April 2018, coordinated by the Sierra Club Foundation) Gun Violence Signed on to an investor statement asking companies to take a stand on gun violence by adopting sensible policies to protect their employees, consumers, and communities, and take steps to address the dangerous culture of gun violence in our country. (March 2018, coordinated by ICCR) Palm Oil Supported the Roundtable on Sustainable Palm Oil (RSPO) by signing investor letter that expresses the need for a more transparent and responsive complaints mechanism to properly uphold the RSPO s standards, particularly with respect to labor rights. (March 2018, coordinated by Green Century) Indigenous Rights Asked companies to take broad, systemic action to protect human rights defenders, and immediate action to ensure the protection and physical safety of indigenous rights defenders in the Philippines via investor letter. (March 2018, coordinated by Investor Alliance for Human Rights) Food & Beverage Labeling Signed on to a letter urging the Trump administration and Congress to protect public health by opposing efforts that would limit food and beverage front-of-pack labeling in NAFTA. (April 2018, coordinated by Center for Science in the Public Interest) Chevron Joined other investors in inviting Chevron s new CEO to engage in a dialogue on risk management and board oversight, as they relate to the company s long-term challenges particularly its devastating levels of pollution that affect impoverished communities in Ecuador. (Investor letter, April 2018, coordinated by Zevin Asset Management) 10

11 Investment DANA Advisors Physical Address: Swenson Drive Suite 400 Waukesha, Wisconsin Mailing Address: P.O. Box 1067 Brookfield, Wisconsin (262) (800)